Page 259 - DMGT547_INTERNATIONAL_MARKETING

International Marketing

Notes In the insurance industry, systems have been developed specifically to serve the strategic purposes
of particular insurance companies. A good example of such an arrangement involves AEtna,
which, through its GEMINI system, offers its agents a fully integrated proprietary system that
includes a back-office agency management system together with an electronics linkage to the
company's mainframe. Although this approach significantly increases the costs of the target
firm's initial adoption, it also makes the adoption of additional interfaces very costly.
At the other end of the spectrum, there are insurance companies, like Maryland Casualty, that
take pride in facilitating the implementation of EDI by adapting themselves to whatever
equipment the agents have, and using the public value-added network of the industry. Typically,
the solution is a stand-alone PC that de-couples the internal agency system from the EDI and its
outside communications. The result is a flexible (and modular) approach at the expense of full
data integration with the agency's internal computer processes and databases. This approach
significantly reduces the costs of the initial adoption, but leaves the source firm subject to easy
adoption of additional links by the target firm.

Self Assessment

Fill in the blanks:
16. With a ..................... and an online shopping engine it is working even when your shop or
office is closed.
17. A website can reach anyone anywhere in the world who has access to the internet, you are
only a search or a click of a button away from any ..................... user.

Case Study The Panama Canal Negotiations

he completion of the Panama Canal is one of the world’s great engineering feats.
The negotiations to complete and build this vital connector between two oceans
Tspans decades. The cost in human lives, suffering, and capital staggers the
imagination. It all began in 1847 when the United States entered in a treaty with New
Granada (later to be know as Colombia), and which allowed the U.S. a transit passage over
the Isthmus of Panama. The treaty guaranteed Panama’s neutrality and recognized that
Colombia would have sovereignty over the region.
Nothing really occurred with this development and ultimately, a French company called
the Compagnie Nouvelle du Canal de Panama acquired the contract to build the canal
in 1881. By 1889, the Compagnie had gone bankrupt and had lost roughly around
$287 million U.S. along with approximately 20,000 lives in the process. It is also in 1889
that the U.S. has become convinced that the canal passage was absolutely vital to their
interests. They appointed Rear Admiral John Walker to head the Commission and to
choose the most viable route.
Naturally, the U.S. was interested in the Panama route already started by the French. The
French company which had been heading for bankruptcy, and seeing the writing on the
wall before their bankruptcy in 1889, had entered into negotiations with the U.S. The
French company was eager to extricate themselves from the project. At the time, their
holdings were extensive and included land, the Panama Railroad, 2,000 buildings, and an
extensive amount of equipment. They felt their total holdings should be valued around

Contd...

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